Jul 14, 2006 7:02 pm US/Central
Target May Leave City Over Big-Box Proposal
Ordinance Would Set Minimum Wage, Benefits For Big-Box Retailers
by Mike Flannery
CHICAGO (CBS) ―
Chicago is in a fight with big box stores. The City Council is trying to raise the minimum wage at those stores to $10.
Now, Target is fighting back and threatening to close stores in the city.
CBS 2 Political Editor Mike Flannery explains who shoppers could be the ultimate losers.
Workers are putting the finishing touches on Chicago's newest Target at 2200 W. Peterson, scheduled to open a week from Sunday. But it could close for good soon after if the company makes good on threats delivered privately to aldermen.
The City Council is scheduled to vote July 26 on an ordinance that would require "big-box" retailers to pay employees at least $10 an hour and $3 in benefits by July 1, 2010. The ordinance, which would apply to stores with at least 90,000 square feet and annuals sales of $1 billion across all operations, has attracted support from 33 aldermen despite the opposition of Mayor Richard Daley.
Former Target employee Lula Moore likes that idea.
"I have a family to take care of. So, the money that they're paying is just not gonna work for me," Moore said.
But a newly-hired worker fears Target and other big box employers might actually leave the city for the suburbs.
"That's it. A lot of people would be out of jobs," said Ayesha Williams.
"If you're gonna raise the wages on jobs that doesn't exist, nothin' from nothin' leaves nothin'," said Ald. Emma Mitts.
Ald. Mitts said she's worried that raising the hourly minimum wage to $10 in Chicago only would jeopardize a new 150,000 sq. ft. Wal-Mart opening in September in her 37th Ward and would kill plans for a new Menard's on the site of an old Unilever factory.
That is dismissed as blackmail by supporters of the $10 minimum wage.
"If businesses had their way, they'd probably still be paying a dollar a day. We need to fight to preserve the middle class, and that's what this ordinance is all about," said Ald. Joseph Moore.
Alderman Howard Brookins (21st) also said Thursday that new stores on the city's South Side appear to be in jeopardy because of the ordinance, saying Minneapolis-based Target will cancel projects or take a wait-and-see approach.
"That wait-and-see approach may be three or four or five years out before they know how this may really affect their bottom line, before making decisions to come in those areas," Brookins said.
Alderman Leslie Hairston (5th) said she has a letter of intent from Target to build a store in her South Side ward. But the developer has told her the store is on hold and Target may close existing stores if the ordinance goes through, she said.
Hairston called the threat by Target a scare tactic, adding she is firm in supporting the ordinance.
The controversy over "big-box" wages is the latest stirred up by the Chicago City Council. A Wal-Mart planned for Brookins' ward was blocked because of council opposition to low wages paid by the Arkansas-based retailer.
Brookins said Wal-Mart officials claim residents of his ward spent $17 million at their stores outside Chicago.
Opponents predict that if the City Council does pass the $10 wage, courts would rule it unconstitutional because it would apply only to big box stores and not other retailers.
"See you in court," is what supporters say.
Target officials have not made public statements on their views of the ordinance, and have not responded to requests for comment.
(© 2006 CBS Broadcasting Inc. All Rights Reserved. This material may not be published, broadcast, rewritten, or redistributed. The Associated Press contributed to this report.)
